Great news for the China export container shipping market! Over the past week, there has been a significant improvement in transportation demand, leading to a surge in ocean freight rates, particularly on the Europe and America routes.
🌟 Asia-Europe Routes: The supply and demand situation has improved, with shipping companies successfully implementing price increases, resulting in a substantial 31.4% surge in spot rates from Shanghai Port to European base ports, reaching $975 per TEU on July 28, up from $742 per TEU the previous week.
🌟 Mediterranean Routes: Similar to the European routes, spot booking prices from Shanghai Port to Mediterranean base ports also witnessed a modest increase, rising by 6.8% to $1503 per TEU on July 28.
🌟 US Routes: The US market remains strong, maintaining high transportation demand and favorable supply-demand dynamics. Consequently, spot rates from Shanghai Port to the US West and East Coast base ports climbed by 10.1% and 6.6%, respectively, on July 28.
Despite these positive trends, some analysts from the Shanghai Shipping Exchange caution that the economic outlook for Europe and the US might not be as optimistic. The Eurozone’s preliminary Markit Composite PMI dropped to 48.9 in July, marking the lowest level since November last year. Meanwhile, the US GDP grew 2.4% in the second quarter, but rising interest rates pose risks to future economic growth.
On the other hand, China’s export volume in the first half of the year increased by 3.7%, reaching 11.46 trillion yuan. With a series of policy measures and a strong underlying economic foundation, experts believe that China’s exports will likely maintain a stable and high-quality growth trend in the coming months.
Looking back at the past two months, mainline shipping rates in Europe have fluctuated between $740 to $800 per TEU, experiencing a total increase of 15.2%. The US routes saw significant price fluctuations, with rates ranging from over $1900 to as low as $1173 per FEU, registering a peak weekly surge of 26%.
While the recent surge in spot rates suggests a rebound, industry experts remain cautious about declaring the arrival of peak season. Many container shipping companies are still wary of the market’s prospects. Industry leaders like Evergreen Marine Chairman, Zhang Yan Yi, suggest that it may take until the end of the third quarter or early fourth quarter for rates to show significant improvement.
As Clarkson analyze the shipping market report that vessel deliveries reached a historical high in June, with 34 ships totaling 295,000 TEU, including 82% large containerships of 12,000 TEU and above. In the first half of this year, new vessel deliveries amounted to 147 ships, totaling 975,000 TEU, showing a remarkable 129% year-on-year growth.
Despite this surge in capacity, it is predicted that the global container shipping fleet will experience approximately 7% growth in 2023, with the annual new vessel delivery record expected to be surpassed by 2024, reaching 2.5 million TEU.
In conclusion, while there have been positive developments in the China export container shipping market, the outlook for the second half of the year remains uncertain due to the continuous influx of new capacity and sluggish demand growth. Stay tuned for further updates on the shipping market as we closely monitor the situation.